The New Zealand dollar rose to an eight-week high against the greenback, as the United States currency fell against higher-yielding currencies after the Federal Reserve's commitment to low interest rates yesterday prompted investors to seek higher returns elsewhere.

The kiwi peaked near US71.80c about 6.45pm, but by 8am had dropped to US71.44c, still above the US71.22c at 5pm yesterday.

The NZ dollar also peaked at a two-year high 0.5217 euro and an eight-week high 64.95 yen. By the local open the kiwi was down to 0.5195 euro, still above the 0.5166 euro at 5pm, and fell to 64.45 yen, compared to 64.19 yen at the local close.

Against the Australian dollar the kiwi peaked at a two-week high A77.69c but then fell to A77.40c at 8am, lower than the A77.52c at the local close. The trade weighted index was up from 65.48 at 5pm to 65.64 at 8am.

"If you look at the broader picture, we're seeing most major currencies - sterling, Australian, and New Zealand dollars -- rallying against the US dollar," said John McCarthy, director of FX trading at ING Capital Markets in New York. "Clearly, risk appetite is up."

- NZPA